FX.co ★ U.S. Mortgage Applications Grow 7.1% - MBA

Mortgage applications within the United States experienced a more sluggish growth in the week concluded on March 8, according to the latest weekly survey data from the Mortgage Bankers Association (MBA).

The volume of mortgage loan applications, quantified through the Market Composite Index, observed a seasonally adjusted 7.1 percent hike, as suggested by the MBA's Weekly Mortgage Applications Survey data. There was a higher 9.7 percent inflation in the preceding week which ended on March 1.

The Purchase Index recorded a seasonally adjusted 5 percent rise in contrast to the 11 percent growth in the week before. Simultaneously, the Refinance Index saw an increase of 12 percent compared to 8 percent the prior week.

According to the MBA's Senior VP and Chief Economist Mike Fratantoni, most of the mortgage rates dipped below 7 percent in the last week for a majority of loan types. This change was prompted by incoming economic data displaying a faltering service sector and a more subdued job market, as signified by an uptick in unemployment rates and a reduction in previously predicted job growth.

Although there was an escalated purchase application volume, it remained around 11 percent lower than the levels of the previous year. In contrast, the refinance volume witnessed a surge of 12 percent, predominantly credited to a 24 percent increment in the government refinance index, explained the economist.

Fratantoni went on to add that while these percentage rises appear significant, the volume of refinance activity continues to be relatively limited. He also expressed that most likely this activity comprises borrowers who secured a loan at or near the peak rates during the past two years.